1. Field of the Invention
The present invention relates to methods of directing the sourcing of a part or a component from a secondary supplier.
2. Background Art
As the size and complexity of manufactured articles increases, the complexity of efficient component purchasing systems for such articles increases. Manufactured items such as automobiles include numerous sub-systems each of which include a number of components. For example, automobiles include a powertrain system, sound systems, exhaust systems, environmental control systems, computer control systems, and the like. Moreover, market and governmental pressures require the constant design and redesign of these systems. Each system includes many discrete subcomponents that are purchased from suppliers.
Experience in the purchase of automobile components has shown that it is desirable to purchase parts from only a select few suppliers that are called Tier 1 suppliers. The advantages of dealing with such a reduced numbers of suppliers include a reduction in accounting expenses, improved component quality, and associated reduction in component expenses. The reduction in accounting expenses is the result of having to monitor and track the performance of a smaller number of primary suppliers. Improved quality is the result of suppliers competing for the coveted Tier 1 status, and from the experience the supplier obtains over time in having such a status. Moreover, the reduction in component costs is a direct result in the competition and experience associated with Tier 1 status.
Notwithstanding the advantages in dealing with a reduced number of suppliers, there are associated problems. Complex manufactured components often include a large number of components. Moreover, a large manufacturing company may manufacture a number of articles each of which include a number of components. Accordingly, it is not always possible to obtain every part from the Tier 1 suppliers.
Manufacturing companies have used various methods to deal with the inadequacies in only purchasing from Tier 1 suppliers. Such methods have typically involved participation by the manufacturing company in the purchasing of parts from secondary suppliers referred to as Tier 2 suppliers. Tier 2 suppliers are those suppliers from which Tier 1 suppliers purchase components. For example, a Tier 1 supplier purchase a part from a Tier 2 supplier and store it until needed by the manufacturing company. Such a situation then creates a bailor-bailee relationship between the manufacturing company and the Tier 1 supplier which may include several undesirable legal consequences.
Another difficulty encountered in the purchase of parts from Tier 2 suppliers is the inability of current purchasing systems to negotiate price with the Tier 2 or higher suppliers. Most purchasing systems are designed to only deal with the Tier 1 supplier, since it is the Tier 1 suppliers role to deal with the Tier 2 supplier. Accordingly, a manufacturing company significantly loses negotiating and leveraging ability with Tier 2 suppliers.
Accordingly, there is a need in the prior art for improved purchasing systems that directly integrate the sourcing process with both Tier I and Tier II suppliers and allow prices to be negotiated with secondary suppliers.